Novomatic Extends Takeover Bid for Ainsworth amid Mounting Tensions

Austrian gaming giant Novomatic AG has extended its bid to acquire the remaining shares of Ainsworth Game Technology (AGT) by another month, with a new deadline of December 3. The company’s ongoing efforts to consolidate its control over the Australian slot machine manufacturer have drawn significant attention after a filing with the Australian Securities Exchange confirmed its intentions.

Novomatic Seeks a Dominant Position

The unconditional off-market bid, originally set to expire on November 3, offers shareholders a price of AUD 1.00 per share. This deal values AGT at roughly AUD 158.6 million ($103.1 million). Ainsworth’s Independent Board Committee encouraged shareholders to accept the offer. According to the Committee, an independent expert determined that the deal was “fair and reasonable,” provided no better proposals emerge before the new deadline.

Throughout 2024, Novomatic has gradually tightened its control over the Sydney-based company. Since revealing its full takeover ambitions in April, the gambling giant has steadily increased its ownership from 52.9% to about 61.5%. Initially, the company sought the deal through a Scheme of Arrangement. However, a group of shareholders led by Kjerulf Ainsworth, the son of company founder Len Ainsworth, blocked this initiative.

These ongoing frictions add to the internal turbulence at Ainsworth following the resignation of CEO Harald Neumann, a former Novomatic executive. Neumann left after the Nevada Gaming Control Board advised him to withdraw his US license application, citing reports linking him to a political funding investigation in Austria. His departure comes at a critical time for the company, deepening investor uncertainty.

Minority Investors Remain Firmly Opposed

Despite the Independent Board Committee’s recommendation, resistance to the takeover remains stiff. Kjerulf Ainsworth recently launched a limited counter-offensive with a proportional takeover bid that would raise his share from 7.27% to 9.9%. His offer of AUD 1.30 per share substantially surpasses Novomatic’s. Ainsworth presented his bid as an attempt to safeguard shareholder value and retain Australian influence in the company’s direction.

In a letter to shareholders, Ainsworth noted that his bid was not a challenge to control but a protest against what he described as an erosion of independence. While Ainsworth added that regulatory restrictions prevented him from owning more than 10% of the company, he hinted at possible future moves if the market conditions were right.

I believe that shareholders deserve to have access to an alternative offer that better reflects the real value of AGT.

Kjerulf Ainsworth

The rival offers have revealed the deepening rifts in Ainsworth’s ownership structure, adding to its recent struggles. The company’s performance has been under pressure in recent years due to stagnant demand in its primary markets and rising competition from newer gaming technology firms. While full integration with Novomatic could help stabilize operations, it could also shift control, decision-making, and intellectual property away from Australia.